Diamondex Resources Ltd.

Diamondex Resources Ltd.

October 13, 2005 13:59 ET

Diamondex Updates Lena West, Brodeur and Pegasus Projects

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Oct. 13, 2005) - Diamondex Resources Ltd. (TSX VENTURE:DSP) ("Diamondex") is pleased to provide an update on its recent exploration programs on the Lena West Project, Northwest Territories; the Brodeur Project, Nunavut; and the Pegasus Project, located in Alberta. (See www.diamondex.net for property locations).

Lena West Project, Northwest Territories

During the summer/fall exploration season, a total of 1,724 stream sediment samples were collected over the Lena West project area. Sampling concentrated on four main regions within the permit areas where previous sampling during 2003 and 2004 (a total of 2,161 samples) has outlined significant concentrations of kimberlite indicator minerals (KIMs) - mainly pyrope garnets and picroilmenites. (See www.diamondex.net for indicator minerals and recent mineral chemistry). These samples will be "picked" for indicator minerals and subsequently submitted for chemical analysis and morphological studies at the Diamond Research Institute in Novosibirsk, Siberia under the supervision of Dr. Nikolai P. Pokhilenko. Initial results and analyses for these studies are expected shortly. In addition to the sampling program, Fugro Airborne Surveys has recently completed a GEOTEM survey (fixed wing time domain electromagnetic system) over several high priority target areas. The GEOTEM survey, flown at 100 metre line-spacings, totaled 6,758 line-kilometres and was designed to further define drill targets outlined by the previously completed geophysical surveys and stream sediment sampling programs. A total of 136,000 line-kilometres of airborne geophysics has been carried out over the Lena West Project since 2003, in addition to the recent GEOTEM survey. Samples of core from a recently completed drill program on the project have been submitted for petrological and morphological studies, with results expected shortly. A major drill program is currently being designed to test several targets following the compilation of all geophysical and geochemical data. A budget of $1 million has been allocated for the upcoming drill program. In excess of $10 million has been expended on the Lena West Project since 2003, on land acquisition and exploration, including $3.6 million during the current year's exploration program. These expenditures include till and stream sediment sampling, airborne geophysics (mainly gravity, magnetics and seismic), as well as diamond and auger drilling.

The Lena West Project is comprised of 139 prospecting permits and 33 mineral claims totaling 6,164,100 acres, centred approximately 900 kilometres northwest of Yellowknife and 200 kilometres southeast of Inuvik, Northwest Territories. The Lena West Project is 100% owned by Diamondex.

Brodeur Project, Nunavut

During the recent field season, a total of 21,225 line-kilometres of fixed wing magnetic surveys, flown at 100 metre line spacings, were completed by McPhar Geosurveys Ltd. over the Brodeur Project area. In addition, 2,800 line-kilometres of Fugro RESOLVE airborne survey was flown over previously identified airborne magnetic targets. The RESOLVE survey was flown at 100 metre line spacings. As a result of these surveys, several high priority targets have been defined for further exploration. In addition to the geophysical surveys, a total of 661 till and stream samples were collected over the project area, with a number of previously undiscovered kimberlite boulders (measuring up to 30 cm in diameter) recovered. These boulders, located down ice from several airborne geophysical targets, are currently being analysed for diamond content with results expected within the next month. To date, three kimberlite bodies have been outlined with the largest kimberlite, Tuwawi, having a surface expression approximately 4 hectares in size. A budget of $800,000 has been allocated for follow-up drilling to test the recently defined targets. Approximately $9.5 million has been expended on the Brodeur project area (including $8 million spent by Kennecott).

The Brodeur Project is centred on the northern half of the Brodeur Peninsula of Baffin Island. Diamondex has the exclusive option to earn a 100% interest in the property, subject to an underlying Property Acquisition Agreement with Kennecott Canada Exploration Inc. The property comprises a number of claims and prospecting permits totaling 407,621 acres and hosts three known diamond-bearing kimberlite bodies: Tuwawi, Nunuk, and Kuuriaq.

Pegasus Project, Alberta

On August 16, 2005, Diamondex announced a significant land acquisition for diamond exploration covering an area of approximately 2.5 million acres in central Alberta. The Company has recently negotiated three one-year option agreements to acquire an additional 132,000 acres of lands internal to the large land package acquired in August. The additional acreage consists of Metallic and Industrial Mineral permits currently held by SandSwamp Exploration Ltd.; 876919 Alberta Ltd.; 1006882 Alberta Ltd.; Comcork Holdings Ltd.; and Glenn Stafford Hartley (the "Optionors"). Each of the agreements provides that Diamondex can acquire a 100% interest in the permit(s) subject to that agreement on or before September 6, 2006 through a combination of cash payments and share issuances to the Optionors, and work commitments. The work commitments total $135,000 over the one-year option period. Collectively, the cash payments to the Optionors would be $45,000 at the commencement of the agreements and $140,000 on the first anniversary to exercise the options, while the number of shares to be issued to the Optionors at the commencement of the agreements would have a value equal to $45,000, plus additional shares with a value of $140,000 on the first anniversary to exercise the options. The properties held by the agreements are each subject to a 2% gross overriding royalty. The Company may elect to "buy down" one-half of the royalty interest applicable to each agreement. The purchase price of each "buy down" is $500,000 if the purchase is made within two years of the exercise of an option, or $1,000,000 if such election is made thereafter. Previous exploration by SandSwamp has outlined several areas of anomalous concentrations of G10 pyrope garnets. Currently compilation of all previous geochemical and geophysical sampling is underway with a detailed airborne magnetic survey over previously designated targets expected to commence before the end of the month. The transactions are subject to acceptance by the TSX Venture Exchange.


A total of 1,493,234 warrants have been exercised at $0.85 to net the Company $1,269,248.90.

Diamondex is a well-financed exploration company holding a very large and prospective portfolio of diamond properties in the lower Mackenzie River area and the southern Slave Province of the Northwest Territories; the Melville and Brodeur peninsulas and the Coronation Gulf district of Nunavut; northern Quebec and central Alberta. The Company holds up to a 100% interest in 16 diamond properties, totaling 11.3 million acres. The 2005 budget for Diamondex's major exploration programs is estimated at $8.5 million.

David Clarke, P.Geol., M.Sc., Vice President of Exploration for Diamondex Resources Ltd. is a Qualified Person as defined by National Instrument 43-101 and is responsible for program design and quality control of exploration undertaken by Diamondex Resources Ltd.


Randy C. Turner, President

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this news release.

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